Ontario is no Greece, but its debt is more than a casual concern – by Konrad Yakabuski (Globe and Mail – July 10, 2015)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

This was the week the debt merry-go-round jerked and lurched and the whole world got nauseous.

Greece, which hit its debt wall years ago, once again took Europe to a precipice. Whatever the outcome of Sunday’s “final deadline” for a deal with its creditors, Greece is a goner, sadly. How much damage it does to the rest of the world remains to be seen.

Greece’s fate could also await Puerto Rico, whose governor suddenly declared that the $72-billion (U.S.) debt the U.S. territory in the Caribbean has racked up is “not payable.” That somehow came as a shocker to bondholders who had been breezily plugging coins into the island’s debt merry-go-round.

Then there’s China, whose debt-induced stock market bubble continued to deflate despite the Communist regime’s best efforts to defy the capitalist laws of gravity. It may take another Chinese miracle to contain the fallout caused by amateur investors who bought stocks on margin.

Amid these bone-tingling examples of the consequences of borrowing beyond your means, Ontario Finance Minister Charles Sousa managed to put a happy face on his province’s credit downgrade by Standard & Poor’s.

The debt-rating agency now considers Ontario, once the country’s mighty economic engine and still home to nearly four in 10 Canadians, no more creditworthy than demographically challenged New Brunswick or Quebec.

For the rest of this column, click here: http://www.theglobeandmail.com/report-on-business/rob-commentary/ontario-is-no-greece-but-theyre-both-on-the-debt-driven-ride/article25404354/